Verizon lets some keep DSL as stand-alone

By Bloomberg News | May 28, 2004

NEW YORK -- Verizon Communications Inc., the biggest US local-telephone company, is trying to retain customers by allowing some of them to keep high-speed Internet service when they cut their phone line and go wireless.

For the first time, Verizon customers in 12 states, including Massachusetts, who are moving their local phone numbers to wireless devices can keep their high-speed Internet service, known as DSL or digital subscriber line, spokeswoman Briana Gowing said.

The offer is a departure for Verizon, which has sold its Internet service in a bundle to encourage customers to buy more services. New York-based Verizon, which has about 2.7 million DSL subscribers, has said it needs 4.3 million to make the business profitable. Competition is increasing as Comcast Corp. and other cable providers roll out digital phone service.

''We do believe stand-alone DSL is the right move for Verizon and the rest of the Bells," UBS Securities analyst John Hodulik wrote to clients. He rates Verizon shares ''neutral 1."

Customers don't have to switch their numbers to Verizon wireless products, Gowing said. The stand-alone product is $34.95 a month. Reuters first reported the offer Wednesday.

''This for us is really about keeping that broadband relationship with the customer," spokeswoman Bobbi Henson said.

Verizon, which sells local-phone service in 29 states and Washington, hopes to ''make a broader offer" of so-called naked DSL, Gowing said.

Right now, only local phone customers in New York, New Jersey, West Virginia, Pennsylvania, Virginia, Massachusetts, Maine, New Hampshire, Delaware, Maryland, Vermont, and Rhode Island can take advantage of Verizon's stand-alone service.

Verizon won't say how many customers are switching their local numbers to mobile phones or how many are buying the stand- alone Internet service.

The company's local lines fell 4.3 percent to 55 million in the first quarter.